In re Fitzpatrick
| Decision Date | 05 August 2020 |
| Docket Number | No. 19-0033,19-0033 |
| Citation | 949 N.W.2d 652 (Table) |
| Parties | IN RE the MARRIAGE OF June H. FITZPATRICK and Thomas Luke Fitzpatrick Upon the Petition of June H. Fitzpatrick, Petitioner-Appellant, And Concerning Thomas Luke Fitzpatrick, Respondent, Holly Riha, Executor of the Estate of Thomas Luke Fitzpatrick, Appellee. |
| Court | Iowa Court of Appeals |
William W. Graham of Duncan, Green, P.C., Des Moines, for appellant.
Deborah Tharnish and Holly M. Logan of Davis Brown Law Firm, Des Moines, for appellee.
Considered by Bower, C.J., and Doyle and Schumacher, JJ. Tabor, J., takes no part.
June Fitzpatrick appeals the district court decision denying her request to declare the parties’ dissolution decree void. June's petition to vacate the decree was filed more than three years after the entry of the original dissolution decree. June did not present credible evidence of extrinsic fraud. Her claims of intrinsic fraud, alleging her former spouse made misrepresentations during the dissolution proceedings, are not sufficient grounds to declare the decree void. We affirm the decision of the district court.
June and Thomas Fitzpatrick were formerly married. On January 4, 2010, June filed a petition for dissolution of marriage.
June was born in Korea and came to the United States in 1975 or 1976. Prior to the dissolution trial, June requested the appointment of a translator. The court ruled it was June's responsibility to find a qualified interpreter and pay the costs. About one month before the scheduled dissolution hearing, June discharged her attorney and thereafter represented herself.1
At the beginning of the dissolution hearing, the court asked June about her request for a translator. She reiterated that she wanted a translator. The court stated June would have to hire an interpreter "because the State isn't going to pay for you to have a translator in a dissolution trial, only in a criminal trial." June said, "That's okay," and the hearing proceeded without the use of an interpreter. While she filed a motion to continue prior to the second day of trial, she orally withdrew the motion. June fully participated in the proceedings.
Thomas presented evidence to show that prior to the marriage he purchased 10,000 shares of stock in his father's business, Camera Corner, Inc., which represented half of the shares in the company. During the marriage, he purchased the remaining 10,000 shares. Thomas did not testify that he still owed a debt to his father. His financial affidavit did not list a debt to his father. June did not present any evidence on the issue. The dissolution decree states, "Exhibit A in Tom's testimony was that he still owes $220,900 for the remaining 10,000 shares." The court found the value of the company was $608,671.76 and deducted $220,900, resulting in a finding that the net value of the company was $387,771.76. The court found Thomas should be awarded the business.
Thomas claimed his mother loaned him $524,760 to purchase property in Hawaii. He testified that he had repaid her estate $51,472 and still owed the remaining amount. June disputed the existence of the debt. The district court stated, "[I]t would be grossly unfair to June, in particular in light of the slim evidence, that the entire $524,000 is a debt that Tom has to pay." The court concluded Thomas was responsible for the debt to his mother but did not determine the amount of the debt, stating, "Tom is in the best position to figure out the exact amount owed and structure repayment to his mother's estate." In light of the debt, Thomas was awarded more assets.
A dissolution decree for the parties was filed on February 21, 2012. Thomas was awarded marital assets worth $3,033,548, not taking into consideration his liabilities, and was also awarded his premarital assets. June was awarded marital assets worth $775,839, plus alimony of $3000 per month for five years. June appealed the dissolution decree. She was represented by counsel for the appeal. Thomas hired appellate counsel distinct from his trial counsel.
On appeal, we found Thomas had been awarded net assets worth $2,527,075 and June had been awarded assets worth $842,239. In re Marriage of Fitzpatrick , No. 12-0472, 2012 WL 4100634, at *3 (Iowa Ct. App. Sept. 19, 2012). In our calculation, we found Thomas owed $220,900 to his father's estate and $473,000 to his mother's estate.2 Id. at *3 n.3. We modified the dissolution decree to award June one-half of Thomas's retirement pension, which was worth $1,614,777, and to award Thomas one-half of June's pension, which was worth $108,839. Id. at *3. Thus, after the modification, Thomas received marital assets worth $1,774,107 and June received marital assets worth $1,595,208. We affirmed the dissolution decree in all other respects. Id. at *4.
Thomas died on June 12, 2013. His sister, Holly Riha, is the executor of his estate. A probate inventory for Thomas's estate was filed on March 10, 2014. June stated she did not see a copy of the probate inventory until November 2015. On December 29, 2015, June filed a petition seeking a determination that the dissolution decree was void based on fraudulent misrepresentations and fraudulent nondisclosure by Thomas during the dissolution proceedings. She claimed Thomas did not have any debts to his mother's or father's estates at the time of the proceedings. June asserted Thomas's misrepresentations prevented a fair submission to the court of the issue of property division.
Riha, as the successor to Thomas in this action, filed a motion for summary judgment. She claimed (1) the action should be barred under Iowa Rule of Civil Procedure 1.1013(1) because it was filed more than one year after the dissolution decree; (2) June failed to exercise due diligence in the dissolution action; (3) June received the benefits of the decree and was estopped to void it; and (4) at most, the decree could be modified, not voided. June resisted the motion for summary judgment. The district court denied the motion for summary judgment, finding there were genuine issues of material fact on June's claims of fraud.
At the trial on June's petition to set aside the decree, beginning on October 29, 2018, she was assisted by a Korean-speaking interpreter. The estate stipulated that Thomas's debt of $220,900 to his father had been repaid prior to the dissolution proceedings. Benjamin Spadt, a CPA financial analyst, testified Thomas repaid $51,472 of the debt to his mother before the dissolution. After the dissolution, he repaid the remainder, $472,528, by a reduction in the amount he received from his mother's estate.
June testified Thomas told her he paid off her attorneys and she believed him. She also testified Thomas said he paid off the judge and "some of the judges are colluded politically," and she believed this as well. She stated she was not able to get all of the financial information she wanted to present at the dissolution hearing. June pointed out that she was not represented by an attorney and did not have an interpreter for those proceedings. June asserted that Thomas was not truthful about the value of assets during the dissolution proceedings.
The district court found Thomas did not make material misrepresentations about the loan from his mother noting he "continued to treat the money he received from his mother as a loan and in fact repaid the funds to his mother's estate, by declining distributions which would otherwise have gone to him."
The court found Thomas never represented that he owed $220,900 to his father's estate. The court also found, "there is good reason to believe June was well aware the debt to Tom's father's estate had been paid off prior to trial." The court stated:
It is certainly true that both the trial court and the court of appeals were incorrect in their conclusion Tom owed his father's estate some $221,000 at the time of the divorce. This conclusion was not, however, due to any misrepresentations made by Tom or his attorneys during the trial. They simply got it wrong. There is absolutely no evidence to suggest this conclusion was due to any material misrepresentation by Tom made with the intent to defraud either June or the Court.
The district court concluded June failed to establish extrinsic fraud by Thomas.3 The court denied June's petition to declare the parties’ dissolution decree void. June appeals the district court's decision.
This action was brought in equity and our review is de novo. Iowa R. App. P. 6.907. "In equity cases, especially when considering the credibility of witnesses, the court gives weight to the fact findings of the district court, but is not bound by them." Iowa R. App. P. 6.904(3)(g).
"A party may institute a suit in equity seeking to vacate a judgment and obtain a new trial where, with reasonable diligence, he or she was not able to discover the fraud or other grounds for vacating the judgment within one year after the judgment." Johnson v. Mitchell , 489 N.W.2d 411, 415 (Iowa Ct. App. 1992) ; see also In re Marriage of Rhinehart , No. 09-0193, 2010 WL 446560, at *2 (Iowa Ct. App. Feb. 10, 2010). In such an action, it is "essential that the fraud be extrinsic and collateral to the proceedings and issues in the original case." Johnson , 489 N.W.2d at 415. "A party attempting to vacate a judgment in an equity suit has a heavy burden." Id.
There are two types of fraud: intrinsic and extrinsic. In re B.J.H. , 564 N.W.2d 387, 391 (Iowa 1997). "Extrinsic fraud ‘is some act or conduct of the prevailing party which has prevented a fair submission of the controversy.’ " Id. (citation omitted). Extrinsic fraud "includes lulling a party into a false sense of security or preventing the party from making a defense." Id. (citation omitted). It "pertains to the manner in which the judgment was procured." In re Marriage of Kinnard , 512 N.W.2d 821, 823 (Iowa Ct. App. 1993).
On the other hand, intrinsic fraud does not...
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